So far, so good. The Australian Securities and Investments Commission’s financial adviser register (FAR) is up and running in its first phase. Phase two begins in a couple of months.
A quick check of some of the details about one financial planner well known to Professional Planner (hi Mark!*) reveals that the information there, if limited, seems to be complete and correct. In fact, a first look revealed some things not already known about this adviser, so at least one consumer is slightly better informed than before, thanks to the register.
The register reveals the ultimate controller of the adviser’s licensee is a major bank – and names the bank – so that’s a good development, too. Not that the planner made any secret of this, but that’s not always the case.
The information on the FAR is necessarily qualified. The ASIC website says, in part:
• The information on the register is provided by financial advice businesses (licensees and/or authorised representatives) and ASIC does not check or review the information before it is put on the register; and
• Information about qualifications, training and professional association memberships will be added at the end of May 2015.
Independent verification
Licensees and authorised representatives can be fined for providing misleading information (penalties will apply from September this year) and licensees are being urged to ensure independent verification of information before posting it to the register. (In fact, they’re being encouraged to use the advent of the FAR to improve reference checking and on-boarding procedures for new authorised representatives as well – but that’s another story.)
There are a few issues that remain to be resolved, and no single register can ever satisfy absolutely everyone. The adviser “appointment timeline”, for example, is potentially useful but in many cases incomplete (for some the timeline starts on March 30, 2015, and as of yesterday extended for only a matter of hours) and it appears that providing information for the register’s “previous appointments” section has been treated by some as optional.
REACTION TO LAUNCH OF ASIC REGISTER
• Financial Planning Association
• Financial Services Council
It’s difficult to see how it might cause consumers to make worse decisions – but that’s a different question.
Really only a start
But it’s not only the ASIC register that advisers can use, and this is really only a start. In fact, it’s only half a start, with phase two not yet even in effect.
As Professional Planner has previously reported, there’s at least two other registers: Adviser View, operated by Westpac through its BT Financial Group subsidiary; and Adviser Ratings, operated by a corporate authorised representative of the financial planning and online advice business iPraxis. Others may join the fray.
Adviser Ratings is one to watch. Headed by a former director of campaigns for CHOICE, Christopher Zinn, it will take all of the information provided by licensees and authorised representatives to ASIC and then build its own consumer-friendly information on top of that. It will include information on remuneration and fee structures, and possibly some of the practical implications of the vertical integration of advice businesses and product manufacturers.
Needless to say, consumer feedback and opinions will play a part – making it kind of like Trip Advisor, only for financial planners.
Zinn says the ASIC register is the start of something that could genuinely change the financial planning profession, and empower consumers to make much better choices about which financial planners they use, and which they do not, even though phase one might look like a modest start.
“First holes in the ground don’t look very impressive,” Zinn told Professional Planner yesterday. But every great building needs deep foundations.
*The ASIC register produces 576 results for a search on the name “Mark” – so this is not giving anything away.
